15 October 2021
SEBI vide order dated 27 September 2021, disposed of the proceedings against E-City Hi-Tech Projects LLP and Atul Goel in the matter pertaining to the alleged insider trading in the scrip of ZEE.
SEBI had initiated an investigation to ascertain whether the noticees had traded in the scrip of ZEE, while in possession of certain unpublished information prior to the release of an open letter and a press release by the chairman of ZEE.
SEBI while considering the matter, looked into whether the alleged information was unpublished or price sensitive in nature, SEBI held that the information contained in the open letter and the press release was information that was related to the securities, the information was not generally available and upon becoming generally available, the information was likely to materially affect the price of the securities.
SEBI however noted that since the noticees were not promoters of ZEE and could not be categorised as immediate family members to any insiders or connected persons of ZEE, the noticees could not be categorised as insiders for the purposes of the SEBI (Prohibition of Insider Trading) Regulations, 2015. Further, SEBI held that the noticees had been able to present evidence to discharge their onus to show that they were not directly or indirectly associated with ZEE and therefore they were not reasonably expected to have access to unpublished price sensitive information.
The show cause notice and the subsequent proceedings were accordingly disposed of by the SEBI whole time member.
Please click here to read the SEBI order
For further information, please contact:
Souvik Ganguly, Partner, Acuity Law
